Research Universities, Innovation, and Growth: IRI Medal Address: In This Article Adapted from His 2015 IRI Medal Address, Subra Suresh Describes How Universities Power Innovation and Spur Economic Growth

In preparing for this talk, I thought that I would approach the topic of innovation and growth from two vantage points. First, I would like to consider it from the viewpoint of my previous job as the director of the National Science Foundation (NSF), which by charter of Congress funds basic research in all fields of science and engineering. NSF is the only government agency whose mission is to fund work across all fields and to push the envelope in basic science. Second, I would like to approach it from the perspective of my current position as president of a major research university, Carnegie Mellon. Both of these institutions make very real, substantial contributions, not only to innovation but to our national economy. The NSF: Return on Investment As part of my job at the NSF, I had the opportunity to testify to Congress several times a year on the NSF budget and on matters related to science policy. During these interactions, the question of "return on investment" of taxpayer dollars featured prominently. When the NSF was created in 1950, its annual budget was only a few hundred thousand dollars. Today it's about $7.3 billion. That's the amount of money Americans spend on potato chips each year; it's just 1.6 times the amount of money we spend on Halloween candy and one-seventh of the amount we spend on pet food. That is the entire budget for government-funded basic research supported by NSF in all fields of science and engineering in the United States. What is the return on that investment? Since 1950, approximately 220 American Nobel Prize winners have had some portion of their Prize-winning work funded by the National Science Foundation. That's 70 percent of American Nobel Prize winners and 35 percent of all Nobel Prize winners funded at least in part by one agency. The NSF has delivered more tangible economic returns, too, through the SBIR program. In the early 1970s, when Congress decided it was important to fund small business innovation research, the program was initially channeled through the NSF--NSF was the first federal agency to have SBIR. Today, Congress mandates that 2.3 percent of NSF's budget be devoted to supporting small businesses. Some of these small businesses have changed the world. A company called Linkabit received $25,000 from NSF through the SBIR program. Linkabit is now called Qualcomm. Irwin Jacobs, the cofounder of Qualcomm, said in a video interview given to NSF in 2011 that that $25,000 made all the difference at that time, and that there was a huge "multiplier effect" of that seemingly modest investment. Symantec, which now employs more than 18,000 people and provides antivirus and other software to both large corporations and individual users, received NSF funding in its early stages. More recently, the NSF provided support to graduate students at Stanford to do purely mathematical work on something they called the page-rank method. Their names are Sergey Brin and Larry Page. The NSF funded them before the venture capitalists in Silicon Valley helped create Google. This is the return on basic research. This is the importance of basic research: $7.3 billion a year--for a program that has supported 70 percent of all American Nobel Prize winners, that has supported or seeded the ideas for the initial evolution of companies like Qualcomm, Symantec, and Google--is a relatively small amount of money for the impact it has had on the US and global economies. But if the NSF had asked "What is the return on investment?" as the initial condition for funding, many of these projects would not have been funded. With the best ideas, you don't see an outcome immediately. There is no return on investment from a conventional point of view. Research Universities: Feeding the Innovation Ecosystem In the 1940s, when Vannevar Bush was preparing his now-famous report "Science: The Endless Frontier," the report that would lead to the founding of the NSF, he made three core arguments. …